Circular 14/2020 - 07.10.2020

New EU Retail Payments Strategy

Circular for information, no response required.

On 24 September 2020, the European Commission published a Communication on a Retail Payment Strategy for the EU. The Commission’s strategy aims to boost the take-up of safe and convenient digital and instant payment solutions with pan-European reach, to achieve a fully integrated retail payments system in the EU, to facilitate payments in euro between the EU and other jurisdictions and promote the emergence of home-grown pan–European payment solutions. Some of the actions proposed by the strategy are directly relevant for retailers and the means of payment they accept from consumers. Please do not hesitate to raise with us any issue related to the Retail Payment Strategy.

Building on the wave of innovation in the payment sector over the last years, and the will to overcome the remaining fragmentation of the EU payment market, the strategy proposes a whole range of actions in the next years. The list below summarises the most relevant aspects for retailers.

Boost the uptake of instant payments (by end 2021)

  • The Commission will assess the necessity to legislate to require payment service providers and all relevant stakeholders to adhere to the SEPA instant credit transfer (a standard which allows instant payment transactions in EUR currency to any beneficiary within Euro Zone) in order to achieve a full uptake of instant payments in the EU.
  • This mandatory adherence may be accompanied by the development of a standardised solution for QR codes for both consumer-presented and merchant-presented QR codes for instant payments, to facilitate the deployment of this payment solution across Europe.

Comprehensive review of the Payment Services Directive 2 (to be launched end 2021) - key measures

  • Assess existing consumer protection measures for instant payments.
  • Assess the impact of charges levied on consumers for instant payments, possibly requiring that they be no higher than those levied for regular credit transfers.
  • Monitor the implementation of the Strong Customer Authentication (SCA) requirements for electronic transactions, monitoring of the impact of SCA on the level of fraud, and possible additional measures to tackle new forms of frauds with regards to instant payments.
  • Review the existing legal limits on contactless payments, striking a balance between convenience and risks of fraud.
  • Review/evaluate new risks stemming from unregulated services (e.g. ancillary to e-money services) and include the issuance of e-money as a payment service under the PSD2.

Boost the deployment of new pan-European retail payment solutions (end 2023) - key measures

  • Explore the possibility to develop a ‘label’ for eligible pan-European payment solutions.
  • Facilitate the deployment of European specifications for contactless card-based payments.
  • Support the modernisation and simplifications of EU merchants’ acceptance facilities, such as enabling cash registers to issue e-receipts, with guidance and awareness raising for SME retailers.

Improve acceptance of digital payments at retail level (2022) - key measure

  • The Commission will carry out a study on the level of acceptance of digital payments in the EU, including by SMEs, and possibly propose legislative action to remedy low levels of acceptance.

Better exploit the potential of electronic identity for payment authentication solutions - key measure

  • Extend the application of the eIDAS Regulation (electronic identification and trust services for electronic transactions) to the private sector to promote the use of electronic identity and support the fulfilment of Strong Customer Authentication for payment transactions.

Actions to maintain the availability of 'central bank' money

  • By the end of 2021, the Commission may decide to take action to protect the acceptance and availability of euro cash at retail level.
  • The Commission will support the work of the European Central Bank for the issuance of a Central Bank Digital Currency which would be available to the general public. This is to be seen as a reaction to the growth of crypto-currencies and other asset-reference tokens used as a form of payment.

Please contact Alexis Waravka in case of any questions (Alexis.Waravka@IndependentRetailEurope.eu or tel.: +32 2 739 60 92).

 

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